The Service Sector in a Hierarchy of Rural Places: Potential for Export Activity
Department or Administrative Unit
This article develops and applies a simple empirical methodology based on the location quotient to identify the existence, direction, and nature of service trade within a hierarchy of places. Our methodology rests upon the well-known foundations of central place theory set forth by Christaller (1966). It assumes a hierarchy of places in which the market area of each place is nested in the market area of the next highest order place, an extent of trade within the hierarchy that is dominated by agglomerative economies, and a flow of agglomerative services from higher to lower levels (Christaller 1966). We further presume that profit seeking entrepreneurs will seek out and find most profitable local and export activities. Unlike the models of the urban hierarchy that constrain service sector activities to some mix of residentiary production and sales in the immediate hinterland, our model of basic imports and exports allows basic service activities to arise throughout the hierarchy. Our model empirically distinguishes between those exports that originate in a higher order place and flow only to lower order places in the appropriate hinterland and those exports that cross hinterland borders.
Gilmer, R. W., Keil, S. R., & Mack, R. S. (1989). The Service Sector in a Hierarchy of Rural Places: Potential for Export Activity. Land Economics, 65(3), 217. https://doi.org/10.2307/3146667
© 1989 by the Board of Regents of the University of Wisconsin System